Sales tax hike will affect some more than others

Published 12:00 am Tuesday, July 1, 2003

Tribune editorial staff

The good news is Ohio has a spending plan in place for the next two years that avoids severe cuts to many state services. The bad news is that it took a tax hike of nearly $3 billion to do it.

This is one of the largest budget deficits Ohio has ever faced. In order to meet its obligations, the Legislature had to come up with a spending plan that balances an out-of-whack budget. No bells and whistles, just the basics.

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tax increase - a two-year, 1-cent hike in the state sales tax, to generate an estimated $2.5 billion over the next two years - is just Ohioans' way of helping the state balance its budget. The hike in the overall rate will take the state sales tax to 6 percent, but when local piggyback taxes are included, the total sales tax rate will rise to 7.5 percent in Lawrence County.

The budget bill will most affect low-income families who cannot afford additional burdens, those making high-dollar purchases and those who utilize services that were never taxed before, including manicures, tanning, skin care and massages.

However, it will not only be the consumers who are affected. Business owners had little or no time to prepare for the additional tax. The taxes kicked in today, and Gov. Bob Taft signed the budget bill Thursday - just four business days before the sales tax went into effect.

We understand the budget was under intense debate and plenty of changes were made. We just wish the legislators would have given business owners a little more time to figure in the extra costs.

Given the alternative - cutting services such as Medicaid and education - a penny sales tax is not that bad. It could have been better, though.

Now, we as Ohioans and consumers will pay the bill - one penny at a time. A penny on the dollar may not sound like much, but over time it will add up. Unfortunately, a lot of us cannot afford to pay an extra penny for every dollar we spend.

As Benjamin Franklin once said "A penny saved is a penny earned." Over the next two years in Ohio, though, $2.5 million that could have been saved will be spent.